- Circana
- Apr 22
- 2 min read
CHICAGO, April 22, 2026 — U.S. retail spending showed modest growth heading into spring, but beneath the surface, consumer behavior remains shaped by a complex mix of economic headwinds and short-term tailwinds. Overall U.S. retail sales increased 3.3% year over year in March, with unit demand up 1% across discretionary general merchandise, retail food and beverage, and nonedible consumer packaged goods. While these increases signal continued consumer resilience despite rising gas prices, elevated living costs, and growing financial strain among lower- and middle-income households, factors like calendar shifts and changing behaviors among income groups are critical to note, according to Circana, LLC.
“Topline numbers appear healthy, but appearances can be misleading,” said Marshal Cohen, chief retail industry advisor for Circana. “Retailers are navigating an environment where calendar shifts, promotions, and temporary tailwinds are masking deeper vulnerabilities in consumer spending.”
Consumers Are Adapting, Not Reacting
March retail results were influenced in part by calendar effects, as the Easter shopping period shifted into the first quarter this year, creating challenging year-over-year comparisons. Despite continued economic pressures, consumers have not pulled back uniformly. Spending responses to factors like rising gas prices tend to lag rather than occur immediately, further complicating short-term retail analysis.
Lower-income consumers continue to feel the greatest strain, while growth driven by higher-income households has slowed since late 2025. More recently, middle-income consumers are also beginning to reduce discretionary spending, and that upper-income growth is slowing, creating a shift from what has been a K-shaped economy to more of a “dipping E.”
“The consumer isn’t retreating across the board, but spending patterns are changing, and income-based shifts have the potential to lead retail to a particularly challenging position,” Cohen said. “Today’s retail environment requires retailers and manufacturers to recognize when growth is driven by sustainable demand versus temporary distortion.”
Positive performance is occurring in response to seasonal promotions, price elevation tied to innovation, and shifting weather patterns. However, when those factors are combined with an increasingly distracted consumer, the pace at which retailers must adapt is significantly accelerated. It is increasingly critical for marketers to be able to identify the difference between short-term reactions and long-term behavioral shifts.
“In an environment where the traditional act of shopping is fading, brands need to respond to the consumer’s evolving purchasing language, not just react,” Cohen said. “That means embracing emerging models that are rekindling impulse purchasing, such as social and agentic commerce, with a goal of creating new pathways to discovery and engagement that extend beyond price.”
About Circana
Circana is a leader in providing technology, AI, and data to fast-moving consumer packaged goods companies, durables manufacturers, and retailers seeking to optimize their businesses. Circana’s predictive analytics and technology empower clients to measure their market share, understand the underlying consumer behavior driving it, and accelerate their growth. Circana’s Liquid Data® technology platform is powered by an expansive, high-quality data set, and intelligent algorithms trained on six decades of domain expertise. With Circana, clients can take immediate action to future-proof and evolve their growth strategies amid an increasingly complex, fast-paced, and ever-changing economy.
Contact:
Janine Marshall
